Governor’s Budget Provides $4.3 Billion for California State University

Proposed Plan includes a $7 million reduction of funds for outreach programs

January 16, 2007

Gov. Arnold Schwarzenegger has proposed a $299.5 million
increase for the California State University, which would fully fund
the trustees’ 2007-08 budget request, announced the CSU Chancellor’s
Office Jan. 10.

The proposed
budget provides $3 billion from the state General Fund and $1.3 billion from
student fee revenue. It also recognizes the funding agreement under the Compact
for Higher Education, which provides a four percent or $108.9 million increase
for general operations, $65.5 million for enrollment growth of 2.5 percent to
fund an additional 11,000 students, and $2 million to continue CSU efforts to
increase the number of K-12 math and science teachers.

The 2007-08
Governor’s budget assumes nearly $123 million in student fee revenue based
on a 10 percent increase in student fees and fee revenue associated with the
2.5 percent enrollment growth, said system officials. In addition, it includes
a $7 million reduction from funds currently used to support campus-based outreach
programs.

“We
appreciate the administration’s recognition that fully funding the compact
is imperative to meeting the minimum funding priorities in the CSU budget, but
have concerns over the reduction in outreach programs,” said CSU Chancellor
Charles B. Reed. “We will renew our efforts with the governor and the legislature
to demonstrate the overwhelming benefit of outreach programs on student success
to graduation.”

The CSU had
requested an additional one percent funding above compact to endow a multiyear
plan to reduce salary lags between CSU employees and national benchmarks. Although
not funded, Chancellor Reed said the CSU will seek additional means to address
employee salary lags.

“CSU
salaries for most employee classifications are below average. The CSU needs to
address these lags to maintain a competitive market position for employee recruitment
and retention,” Reed added.

The CSU’s
funding priorities were formed keeping an eye toward long-range goals and needs
of the university, and in consultation with members of the board of trustees,
campus presidents, CSU Academic Senate representatives, and System Budget Advisory
Committee members. According to the system, the budget begins to address critical
campus funding issues faced as a result of three years of budget reductions.

CSU Budget Expenditure Highlights

$42 million for
mandatory cost obligations, including $28 million for health care benefit increases

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